Sound Shore Management, an investment management firm, has released its investor letter for the third quarter of 2024. A copy of the letter can be downloaded here. The fund’s Investor Class (SSHFX) and Institutional Class (SSHVX) appreciated 6.70% and 6.74%, respectively, in the third quarter of 2024, outperforming 5.89% return for the Standard & Poor’s 500 Index (S&P 500), and trailing 9.43% return for the Russell 1000 Value Index (Russell Value). In addition, please check the fund’s top five holdings to know its best picks in 2024.
Sound Shore Management highlighted stocks like Public Service Enterprise Group Incorporated (NYSE:PEG), in the third quarter 2024 investor letter. Public Service Enterprise Group Incorporated (NYSE:PEG) operates in electric and gas utility business. The one-month return of Public Service Enterprise Group Incorporated (NYSE:PEG) was -9.97%, and its shares gained 37.16% of their value over the last 52 weeks. On December 19, 2024, Public Service Enterprise Group Incorporated (NYSE:PEG) stock closed at $83.19 per share with a market capitalization of $41.447 billion.
Sound Shore Management stated the following regarding Public Service Enterprise Group Incorporated (NYSE:PEG) in its Q3 2024 investor letter:
In recent letters we have discussed the resurgence of nuclear power as a base load electricity source and the opportunities our team has uncovered in the power generation space. Public Service Enterprise Group Incorporated (NYSE:PEG), better known as PSE&G, is another example and one of our strongest contributors for the three-month period. The company is a “hybrid” regulated utility and unregulated nuclear power generator that we were able to purchase at an attractive price relative to its earning power. PSE&G’s well managed, regulated utilities provide consistent returns that we expect will grow steadily with their rate bases. As well, we believe there is unappreciated value in their nuclear plants which sit in an unregulated subsidiary that can capture the upside potential of increased power prices. Carbon-free and reliable electricity commands a premium in the marketplace, as seen in recently announced 20-year long data center sales contracts by peer companies. Presently, PSE&G is in discussions to do the same. Our projections estimate this provides a 20% or more upside to earnings for PSE&G from here over the next few years.
A view of a transmission tower carrying electric wires over the horizon.
Public Service Enterprise Group Incorporated (NYSE:PEG) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 31 hedge fund portfolios held Public Service Enterprise Group Incorporated (NYSE:PEG) at the end of the third quarter which was 34 in the previous quarter. Public Service Enterprise Group Incorporated (NYSE:PEG) reported net income of $1.04 per share in the third quarter of 2024, bringing the total for the first nine months to $2.97 per share. This compares the net income of $0.27 per share to $4.03 per share for the third quarter and first nine months of 2023. While we acknowledge the potential of Public Service Enterprise Group Incorporated (NYSE:PEG) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In another article, we discussed Public Service Enterprise Group Incorporated (NYSE:PEG) and shared Carillon Chartwell Mid Cap Value Fund’s views on the company. In addition, please check out our hedge fund investor letters Q3 2024 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.